French Stocks Hit 17-Month Low Amid Recession Fears

French stocks hit a 17-month low amid fears of a global recession after recent tariff announcements from the U.S. and China. The CAC 40 index dropped over 3.9% with all components in the red, signaling significant market turmoil.

Date: 07-04-2025

AI Rating: 4

**Market Sentiment and Economic Indicators**: The recent report highlights a significant decline in the French stock market, with the CAC 40 index dropping to a 17-month low. The bearish sentiment reflects broader concerns about a potential global recession, particularly following U.S. tariffs and retaliatory measures by China. Such geopolitical tensions often lead to volatility in stock prices, especially for multinational companies exposed to international trade.

The report also provides insights into the individual performances of various companies. Stocks like Kering, Safran, and Airbus experienced notable declines, with movements in excess of 6-8%. Such drops can trigger investors to reassess their positions, potentially leading to further sell-offs if sentiment doesn't improve.

**Retail Sales Dynamics**: Furthermore, the report mentions eurozone retail sales, which grew for the first time in five months, albeit at a slower-than-expected rate of 0.3% month-on-month against a forecast of 0.5%. While this growth is positive, its underperformance in relation to expectations may contribute to investor skepticism about the overall economic resilience in the region.

Year-on-year, retail sales showed an increase of 2.3% compared to a modest increase of 1.8% in January. This slight uptick may not be sufficient to inspire confidence among investors who are acutely aware of the macroeconomic challenges ahead. The sluggish pace could indicate weakened consumer spending, which is crucial for driving corporate revenues.

Additionally, the record increase in official reserve assets to €305.12 billion indicates a strengthening in liquidity, which could provide some stability to the financial system, but may not be enough to offset the concerns about growth prospects. Investors typically look at such reserves as a buffer against economic shocks but remain wary given current uncertainties.

Stocks: AIR.PA SAF.PA KER.PA TEP.PA PUB.PA VIE.PA DSY.PA STLA.MI LVMH.PA ENGI.PA CAP.PA RNO.PA OR.PA BNP.PA ACA.PA TOTF.PA VIE.PA